How is Iraq’s Persistent Electricity Problem Partially Solvable?

August 10, 2021by Farida Hassan0

Every summer, Iraqis protest a lack of power in unbearable heat, and every summer the government promises to do better. Yet, Iraq’s electricity issues persist. In recent weeks, Protesters have taken to the streets against the outages, particularly, in Baghdad and southern provinces where the effect was most felt.

Most Iraqi cities don’t have a 24-hour power supply anyway, but the situation gets desperate over hot summers, when the temperature regularly rises above 50 degrees Celsius. In fact, due to these multiple frustrations the electricity minister, Majed Mahdi Hantoosh, submitted his resignation as public pressure mounted.

Arguably, the main two reasons for this prolonged failure are: external political pressures and terrorist acts. Crippled by US economic sanctions, Iran has been pressuring the Iraqi government to settle unpaid energy bills. Also, over the past few months, there have been a string of attacks on Iraq’s electricity infrastructure. Local media reported, that up to 70 electricity pylons have been sabotaged and the extremist IS, the “Islamic State”, is suspected of being behind these strikes.

© Ahmad El Rubaye – Getty Images – AFP – DW

The Effects of the Outages on Iraqi People and the Government?

Firstly, dysfunctionality in public services, there is a severe outage saw hospitals, government buildings and even local airports without main power for hours, which causes people to protest more from anger. Moreover, electricity minister Majed Mahdi Hantoosh is not the first minister to submit his resignation, but the 18th consecutive electricity minister to resign during summer. It seems that power outage is not only affecting the country economically, but also affecting it politically.

Secondly, it is causing cabinet instability. Eighteen consecutive electricity ministers submitted their resignation because none of them were able to find a solution for this ongoing crisis. Even though, billions were spent for this very purpose of resolving the crisis. For example, in December 2020, a parliamentary committee set up to investigate the power sector reported that $81 billion had been spent on the sector since 2005. Countering all of these efforts is the systemic corruption that mischannelled the capital. The real issue is in the networks, where investment really needs to be concentrated. Iraq’s transmission and distribution losses are some of the highest in the world. If these losses could be brought down by half, it would effectively increase available capacity by one-third. On top of that, last year’s decline in global oil prices means less money in the Iraqi state budget to make those investments. Worth noting that last year’s decline in global oil prices will furtherly complicate the problem.

© The World Bank

The Way Forward

Iraq is going through vicious circles because Iraq’s electricity quandary highlights how difficult it is to fix one thing, without first fixing the other. It is a problem that needs a holistic approach to be solved.

  • Iraqis are protesting for their rights, yet they are not doing their part. As, electricity meters are mostly outdated, and some of them do not work properly, or ignored, or misfitted, also citizens are tapping into power grid for free, which is also known as “hooking”. In other words, the Iraqi citizens are the ones who are stealing and cheating on their own electricity system. Some citizens would commit the theft and ask why they would pay for power when the service is already terrible, and so, protesting. In addition, another development is hindering the process of bill collection: that there is apolitical economy around it, the” generators mafia”. It is becoming a local lucrative business and it is forcefully resisting the government.
  • Iraq needs to get rid of political lobbying, mismanagement, and financial waste in the Electricity sector. In fact, a forceful regulatory framework has to be put to get rid of corruption
  • Mastering International diplomacy is a major key for Iraq to solve this problem. Firstly, it is vital for Iraq to capitalize on its good ties with its allies and at the same time balance its relations with them in a way that doesn’t alienate any of them. In Iraq’s political landscape generally and in the electricity scene particularly there are two important countries, the US and Iran. The American administration would offer Iraq help and full aid, but on the condition of cutting back on Iranian’s gas. Secondly, Iraq has to diversify its imports mix. It has already started on this by signing deals to import power from countries like Jordan, Kuwait and most recently Saudi Arabia and Egypt.

 

References:

  • “Electric Power Transmission and Distribution LOSSES (% of Output) – Middle East & North Africa.” Data, data.worldbank.org/indicator/EG.ELC.LOSS.ZS?locations=ZQ&most_recent_value_desc=false. 

by Farida Hassan

Farida Hassan is an Economics Research Analyst at Synerjies. She is a constant member in the National College Athlete Honor Society, also known as, Chi Alpha Sigma. Prior to her work at Synerjies she worked for the Lion’s Pride News Paper as a Managing Editor, and Political Inquiry. She was rewarded with high academic scholarship of college athletes at four-year accredited colleges and universities, due to her recognizable outstanding academic achievement by intercollegiate varsity letter winners. She graduated with high honors from Saint Leo University in Florida with a degree in Political Science and Economics.

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